25 February 2008
Energy regulator Ofgem has fined National Grid £41.6 million for breaching competition law in the domestic gas meters market.
According to Ofgem, the company had prevented gas suppliers from contracting with other companies for less expensive metering deals. The contracts described were entered into in 2004.
The fine is the largest ever imposed by the watchdog, which stated that the size reflects the serious nature of National Grid's actions.
Ofgem's chairman, Sir John Mogg, commented: "National Grid has abused its dominance in the domestic gas metering market, restricting competition and harming consumers."
He also suggested that the firm's behaviour could discourage suppliers from installing "smart meters", which demonstrate how much consumers can save when they cut down on their energy consumption.
Ofgem claimed that the contracts were "voluntarily entered into" by suppliers and also "delivered immediate and substantial reductions in charges for meter services".
Recently, Ofgem launched a probe into the electricity and gas markets for homes and small businesses.